Appointment fuels development fears for the Malabar Headland

One of Sydney's remaining stretches of undeveloped beachside headland is being sized up for possible development by consultants appointed by the federal government.

The revelation throws into doubt the former federal Labor government's plans to transform about 160 hectares at Malabar Headland into national park and public open space.

The headland, between Malabar and Maroubra beaches, owned by the Commonwealth and just 12 kilometres from central Sydney, has been eyed off for its development potential for decades.

In the 1980s, Club Med wanted to use the Anzac Rifle Range – a 100-hectare central portion of the headland that once doubled as a landfill – as the location of its first Australian resort.

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More recently, the former federal government converted 17 hectares on the western fringe of the site into national park.

But its ambitious conservation and public recreation plans for the rest of the site stalled when the NSW Rifle Association fought eviction in 2012, and there are growing signs the present federal government may want to cash in on its windswept coastal asset.

A project development and environmental consultant, Nation Partners, announced on its website that it had been appointed to advise the Department of Finance on the headland's strategic potential.

But Nation Partners, which refused to comment for this story, has since removed some of the detail about its role and "an initial business case that identified and evaluated development scenarios".

"We have completed an initial review of strategic planning, transport and infrastructure factors, comparable development projects and the technical feasibility of options," the deleted statement said. "This has provided valuable insights and has taken thinking to a new level and demonstrated the potential and value that can be unlocked."

Claire Bettington from Friends of Malabar Headland said the community group was given little information about the latest plans for the area when it met with Department of Finance officials in April.

"We were told that all the old policies of Labor were now off," Ms Bettington said.

State Labor MP Michael Daley said he has written to Special Minister of State Michael Ronaldson after the Nation Partners statement raised "alarm bells" in the community.

"I've been around public life for 20 years," Mr Daley said. "That is as plain as the nose on my face: the Abbott government is planning to develop Malabar Headland to some extent."

Randwick's Liberal mayor Ted Seng said it was "disappointing" the council, which supported the push for a headland national park, had not been kept informed about what was going on.

Liberal Democrat David Leyonhjelm, however, has met with Mr Ronaldson and Finance Minister Mathias Cormann to discuss the headland.

Mr Leyonhjelm, who has announced secure tenure for the rifle range as one of his top priorities, said he had been given a "verbal" undertaking the association would not be moved without somewhere else to go, adding two "serious options" were being considered in the Sydney basin.

"There would be a cost involved in setting [another site] up so that the shooters could move there, but the cost would obviously be a tiny fraction of the value of Malabar if it was commercially developed," he said.

If that were to happen, Jones Lang LaSalle director of valuations Tyrone Hodge said, investor interest in the land would be "significant" after issues such as contamination were resolved.

"Using part of it for residential uses or redevelopment is sensible," Mr Hodge said.

A Finance spokeswoman said the department was preparing options for a "comprehensive strategy for the long-term use" of the headland and had employed consultants to advise on its remediation and potential.

"No decisions have been made on the future of the Malabar Headland," she said, adding the government was committed to returning the South-East Equestrian Club "in the short-term".